PRESS RELEASE

Indian Rayon acquires TransWorks

Indian Rayon, a flagship company of the Aditya Birla Group, announced its entry today into the BPO sector with the acquisition of TransWorks, a leading Indian ITES/ BPO company.

Says Mr. Kumar Mangalam Birla, Chairman of the Group, “We are excited by the potential of the BPO sector and very pleased to have TransWorks joining the Group. This acquisition will also synergise, support and leverage Indian Rayon’s existing thrust in the IT services sector in particular, and the services sector in general:”

TransWorks has delivery centers in Mumbai and Bangalore. It is the world’s first COPC (Release 3.2) certified company. The Company has off shoring contracts with well-known businesses in North America and the UK, including several Fortune 100 clients. TransWorks was funded by the renowned Venture Capital firm ChrysCapital, founded by Mr. Rizwan Kotia and Mr. Jagdish Moorjani, and has a strong management team led by the CEO, Mr. Prakaash Gurbaxani. The Company has a current revenue run rate close to US$1 million per month and employs approximately 1000.

Mr. Sanjeev Aga, the Aditya Birla Group Director, emphasized the Group’s resolve to create a large, healthy BPO business over the next 5 years. “Our aspiration is three-fold: to become a leading BPO player, to provide superior returns to shareholders and to add true value to clients through superior, distinctive, and dependable services,” he said.

While this acquisition gives Indian Rayon a running start into the BPO sector, TransWorks will benefit from the Aditya Birla Group’s financial depth, professional excellence, and strong relationship with potential BPO customers. The Aditya Birla Group operates in 18 countries and has alliances and partnerships with renowned international companies. The transaction which will provide Indian Rayon 100% shareholding in TransWorks, for a total consideration of upto approximately US$13m based on milestones, and is subject to requisite regulatory approvals. ChrysCapital owns about 80% of the paid up share capital of the Company, whilst the rest is held by the founders.

The Indian BPO sector is growing at a 60% clip annually, and is believed to have crossed the US$2.5 billion mark. Building upon the platform and process capabilities already created, the entry of Indian Rayon is expected to propel TransWorks into a higher growth trajectory amongst the best Indian BPO players.

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BPO – A New Opportunity for Indian Rayon

June 20, 2003

1

CONTENTS

• BPO, a promising growth sector

• Indian Rayon’s BPO plans

• Transworks, a stepping stone for Indian Rayon

• Priorities going forward

2

CONTENTS

• BPO, a promising growth sector

• Indian Rayon’s BPO plans

• Transworks, a stepping stone for Indian Rayon

• Priorities going forward

3

GROWTH IN OFFSHORING IS DRIVEN BY FIVE FACTORS

• Increasing pressure on organisations across industries to cut costs

• Increasing complexity of running state-of-the-art shared service centers

• Increasing focus on core activities driven by M&A, privati-zation and deregulation

• BPO vendors with full service offering provide integrated outsourcing solutions e.g., ITO with BPO

• BPO vendors with knowledge of best practices help improve processes

• Attracting and retaining talent an issue in many nascent areas (e.g., biotech) as well as routine activities (e.g., call centers)

Need to reduce costs

Emergence of new

category of vendors

Focus on core

operationsRapid

growth in Business Process

Offshoring

Techno-logical

improvements

• Emergence of high bandwidth telecom networks makes offshore processing viable

Skill shortages

Offshoring is the migration of part or whole of the value chain to a low-cost location. Step-change advances in communications technology make it possible to locate services in the optimal global location, taking advantage of significant differences in skilled labor costs

4

10

22

14

COMPANIES TYPICALLY SAVE 40-60% OF COST FOR OFFSHORED PROCESS

* Hardw are costs are estimated by calculating depreciation and softw are costs include softw are renew al costs** Includes cost of backup

*** Other includes real estate and pow er costsSource: Department of Labor Statistics; press releases; Nasscom-McKinsey Report

70Labor

22Hardware/software1

8Communi-cations/Other

100

US costs

60

Labor costsavings

India costs

0

Hardware/ software*

5

Commu-nications costs**

1

Other***

Typical savings: 40-60% of total process costs

46

5

Size of circle indicates quantity of know ledge w orkers

INDIA HAS EMERGED AS A LEADING OFFSHORE DESTINATION …

Location advantage

• Infra-structure

• Country risks/FDI incentives

• Time zone attrac-tiveness

People advantage• Quality• Cost• Type of skills• English language

High

LowLow High

Australia

India

UK

Philippines

China

Mexico

Singapore

Ireland

India is a very attractive BPO destination. . .

Charac-teristics of attractive geographies

• Large pool of English-speaking graduates

• Low wage costs driven by supply-demand imbalance (under-employ-ment)

0.0

0.5

1.0

1.5

2.0

2.5

0 5 10 15 20 25Annual wagecosts**US$ thousands PA

Ireland

India

Philippines

ChinaMalaysiaMexico

U.S.

Car ibbean*

English-speaking graduates

Massive underemployment of skilled labor

Millions/year

. . . driven by its large pool of talented manpower

Most attractive locations

* Car ibbean countries w ith English as the off icial language** Wages for entry level call center operator or back-off ice processing

Source: Malaysia Ministry of Education; China Population Statistical Yearbook; Statistical Abstract of India, 1999; U.S. Department of Education; Bureau of Labor and Statistical Standards, Philippines; Ministry of Education, Ireland; World Competit iveness Yearbook, 1999; company interview s; The Middle East Economic Data Book, www.salaryexpert.com

6

… AND HAS WITNESSED AN EXPLOSIVE GROWTH IN BPO ACTIVITIES

Snapshot of the Indian BPO industry

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

$ billion

(1994)(1996)

(1997)(1998)

(2000)

(2001) (2001)

(2001)

(2001)

(2001)

(2000)

(2001)

(2002)(2002)

(2000)

(1998-99)

(1998-99)

(2001)

• ~$2.4 billion revenues and ~ 150,000 people employed

• Over 100% annual employee growth over last 5 years

• Significant focus in last 12-18 months: 50-75 plans newly announced/ started

• Targets revised upwards by all players

(2003)

(2003)

2003

(2003)(2002)

2.4

The industry is witnessing tremendous competition and

increasing barrier to entry with more than a dozen well

established BPO players

7

CONTENTS

• BPO, a promising growth sector

• Indian Rayon’s BPO plans

• Transworks, a stepping stone for Indian Rayon

• Priorities going forward

8

THE ADITYA BIRLA GROUP ASPIRES TO ESTABLISH ITSELF AS THE LEADER IN BUSINESS PROCESSING OFFSHORING

• Be among the top 3 India-based providers in each service line focused on

• Be an employer of choice across all employee levels

• Add true value to clients through superior innovation and distinctive delivery

• Create significant returns for its shareholders

BPO vision

9

ADITYA BIRLA GROUP HAS THE INTRINSIC CAPABILITY TO BUILD A LARGE SCALE BPO BUSINESS …

Superior execution

ability as an offshore

BPO provider

Multinational setup and cross-cultural understanding

Domain excellence across several verticals

Deep in-house expertise in key BPO service lines

Proven success with international partnerships

Ability to attract and retain high quality manpower

Stringent focus on quality

Strong financial depth and long term stability

Group’s distinctive strengths

10

… AND SPECIFICALLY, INDIAN RAYON CAN ADD VALUE TO THE BPO BUSINESS

Synergies with PSI-BTL

• Strengthened sales and marketing team

• Existing relationships with customers in key verticals

• Integrated service offering and cross selling of opportunities

Ability to leverage investments in service sector

• Customer contacts in the the service sectors having one of the largest offshoring opportunities

• Expertise of executing back office processes in key service lines– Insurance claims

processing, billing etc.

Indian Rayon, a strong player in knowledge and

services sectors

VALUE ADDITION FOR INDIAN RAYON• Balancing of the business portfolio

• Consolidating its position in emerging service sector

11

• Business ethics • Cultural fit• Performance

management systems • Attrition rate• Training processes

Key buying factorsIndian Rayon to leverage ABG’s existing position

Extent of fulfillment

• Stability • Scale of operations

(today and future)• Ability to manage bottom

line pressures

Financial Strength

• Customer base • Track record with different

customers

Customer base

• Profile of senior managers• Quality of processes

implemented • Demonstrated domain

knowledge• Quality of existing facilities

Compet-ence

Business system/ processes

• Third-largest Indian conglomerate with turnover of over $6 billion and profits of over $500 million p.a.

• No distinctiveness on this parameter

• Best-in-class execution capabilities in various industries such as cement, metal, telecom and financial services

• Successful long-term partnerships with 12 global leaders across financial services, telecom, power, chemicals and IT services

• Significant focus on talent recognition and retention

• Operations in 18 different countries

• Potentially too late for a greenfield option

• Acquisition of a reasonably sized BPO player needed to get a healthy platform to grow

High

LowMedium

HOWEVER, INDIAN RAYON NEED TO ACQUIRE COMPETENCE ON ONE AND STRENGTHEN THEIR POSITION ON TWO KEY DIMENSIONS

12

CONTENTS

• BPO, a promising growth sector

• Indian Rayon’s BPO plans

• Transworks, a stepping stone for Indian Rayon

• Priorities going forward

13

TRANSWORKS HAS SIGNIFICANT EXPERTISE AND CAPABILITIES IN BPO

Facility

• 1999 - currently approx. 1000 people strong

Founded

Vertical focus

• Financial Services

• Telecom

• Technical Support (OEMs)

• Service Providers

• Mumbai & Bangalore – 800 seats

Company overview

Service line expertise

• Customer care (voice, e-mail, web)

• Transaction processing

• Financial accounting processing

Current Revenue • US$ 1 Mn per months

Strengths

• Presence of multiple marquee clients

• Significant number of customers in

– Financial services and

– Insurance verticals

• Robust pipeline and positive momentum in business development

– Started 9 new programs in last 6-9 months

• Senior management consisting of people with significant experience in call center industry

• World’s first COPC certified company (an exclusive standard for BPO industry)

14

TRANSWORKS HAS DEVELOPED EXPERTISE ACROSS SEVERAL SERVICE LINES

Customer care

• 24x7 Customer support• Inbound order taking (e.g., direct mailer response)• Technical support• Telemarketing (e.g., credit cards, telecom, banking)• Collections follow up• Verification calling

• 24x7 Customer service• Technical support• Email-direct mailers & response management

• 24x7 web support (e.g., online banking)• Web-collaboration and co-browsing

Voice

Email

Live Web/Chat

• Order processing• Claims Processing• Loan/Mortgage Processing

• Financial analysis and accounting• Billing• Receivables Management• Creditors Management

Financial Accounting processing

Transaction processing

BPO

15

. . . AND HAS ALREADY DEVELOPED A FEW STRONG RELATIONSHIPS

“Your team’s performance in the first few weeks has fully met my expectations and requirements…. I appreciate your focus on serving our customers and look forward to our continued partnership wi th you”

Vice President – OperationsCard Member ServicesTop 5 Bank

“Your team has consistently impressed us with i ts performance and its ab ility to exceed our expectations”

Head – Customer Service, Large OEM

“ I am very pleased with the polite and caring service the agents provided our card members without exception --on each of these calls…. Wi th so many competitors offering very similar products, it is this type of service which will differentiate us from our competitors..”

Head Operations, Card Member Services Top US Financial Institution

“The program launch at your company has been one of the smoothest and most successful program launches that we have had either internally or with a 3rd party vendor!”

Head – Vendor Operations, Europe Leading Credit Card Company

16

TRANSWORKS HAS A STRONG MANAGEMENT TEAM WITH EXTENSIVE EXPERIENCE IN BPO INDUSTRY

• Amongst the most experienced management teams in India headed by Mr. Prakash Gurbaxani - CEO

• Appropriate blend of International and India experience in senior management team

• Deep functional expertise in all core functions: Operations, HR,Training, Technology and Infrastructure

• First hand experience of successfully serving Fortune 500 companies

Key attributes of Transworks’ team

17

THE COMBINED ENTITY WILL HAVE A STRONG VALUE PROPOSITION…

Past experience of longPast experience of long--running and very successful running and very successful partnerships / relationshipspartnerships / relationships

Strong focus on quality and cost efficiency

Strong financial depth and long-term stability

In-house expertise across multiple verticals and service lines

• Extensive experience across key service lines and verticals

• World-class quality • Strong client reference• Strong workforce and

management team

Transworks

Indian Rayon

18

CONTENTS

• BPO, a promising growth sector

• Indian Rayon’s BPO plans

• Transworks, a stepping stone for Indian Rayon

• Priorities going forward

19

INDIAN RAYON BPO TEAM PLANS TO FOLLOW A THREE STEP APPROACH TO ENSURE EFFECTIVE INTEGRATION AND ACCELERATED GROWTH OF TRANSWORKS

Build the foundation -Strong organisation

• Define the governance mechanism

• Lay out the organisation structure and staffing

Earn the right to grow -Strong business platform

• Strengthen operations• Supplement sales

capability and pipeline• Build a strong performance

culture

Drive growth – Successful BPO business

• Define growth strategy -Inorganic vs organic growth

• Identify target markets• Lay out service lines to focus• Identify target verticals